15-20% interest rate in early 80's
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How the hell was anyone able to qualify for a house and a car loan when the vig was 20 points. 
Quote from Tech Analysis:
How the hell was anyone able to qualify for a house and a car loan when the vig was 20 points.
I remember looking at a lease on a BMW 320i in probably 1982. (I was flush with cash as a young guy, lol). With finance rates of 19.99% or whatever they used to be, that car was not much cheaper per month than a BMW today!
I was young and ignorant then, and put mine all in 14-15% CD's, not knowing that bonds would increase in value as rates fell.
If only I had that to do over.
Nice call Pabst!
If only I had that to do over.
Nice call Pabst!
Quote from Tech Analysis:
How the hell was anyone able to qualify for a house and a car loan when the vig was 20 points.
They didn't. You had to "assume" the seller's mortgage or they had to sell it to you "on contract". You couldn't sell for any reasonable price if you couldn't do either of those somehow. I had a friend who was stuck with a house for 2 yrs after he moved out of the area. It was tough times.
As for cars, I forget if that was exactly when, but the automakers were absolutely desperate to sell cars back then.
Want to hear an even worse one? What if you owed $9 trillion in debt that you had to refinance all the time and rates went to 15%?
brilliant.
Quote from Tech Analysis:
How the hell was anyone able to qualify for a house and a car loan when the vig was 20 points.
I sold RE from late '77 to '83. Prime got as high as 21%. I remember one loan to a couple where their rate was 14% and there were SEVEN points. They would usually break it down like this:
Seller pays 2-3 pts
Loan Origination: 1-3 pts
"Discount Points": 1-3
"Wharehousing Fee" 1-2 pts
Anytime someone asked "what's a wharehousing fee?" We would answer "Another point"
